IBM has created the Sensor and Actuator Solutions group to support devices such as those used in radio-frequency identification setups. The unit will be funded up to $250 million during the next five years to create consulting and other services and software.

IBM says it will roll out in the fourth quarter WebSphere-based RFID middleware that will automate the collection, integration, and management of data collected from tags and readers at distribution centers and stores. The embedded pervasive logic within IBM's software is built on Java J9 open standards.

But the unit is focused on more than simple RFID. It will work with sensors driven by field-programmable logic that can be programmed to manage manufacturing-execution systems and discrete control systems. The sensors, for example, are found in machinery that control conveyer belts used in creating chips at IBM's Fishkill, N.Y., factory.

"We are on a mission to provide an integration layer from the physical environment to the back-end IT enterprise," says Robert Mayberry, VP of the Sensor and Actuator Solutions group. "For the last several years, the chip plant has used the Internet to get back-end apps such as ERP and CRM platforms to communicate with other. We plan to take these batch functions and turn them into real-time platforms."

Sensors and actuators, also known as micro-electromechanical, or MEM, tools, have been around for years. In 2002, MEMs began to venture out of automotive and military uses and into the telecom and computer markets. Since sensors aren't limited to RFID, companies that are looking beyond an RFID slap-and-ship supply-chain environment are beginning to realize that other sensors that sense vibration and chemical content in the air, for example, can connect with RFID platforms.

While the adoption rate for sensors and actuators in the near term is being supported by demand for RFID, Mayberry says opportunities exist in other industries, such as biometrics and energy. Harbor Research estimates there will be more than 1.2 billion devices categorized as "smart sensors" or controllers by 2005.

IBM formed the unit in part because it wants a piece of the contracts to optimize airline engines and to address homeland security needs.

"The country also needs to go back and look at energy utilization, so there will be a time when power and energy plants will come online," Mayberry says, "They will need to take advantage of sensors and actuators."

The 1,000-person group is part of IBM's application-integration middleware division.